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    Saturday, May 9, 2020

    Stock Market - Wall Street Week Ahead for the trading week beginning May 11th, 2020

    Stock Market - Wall Street Week Ahead for the trading week beginning May 11th, 2020


    Wall Street Week Ahead for the trading week beginning May 11th, 2020

    Posted: 09 May 2020 01:02 PM PDT

    Good Saturday afternoon to all of you here on r/StockMarket. I hope everyone on this sub made out pretty nicely in the market this past week, and is ready for the new trading week ahead.

    Here is everything you need to know to get you ready for the trading week beginning May 11th, 2020.

    Stocks are expected to trade the economy's reopening in the week ahead - (Source)


    Investors will watch the economy's reopening progress, as well as a series of economic reports in the coming week that will provide a look at the consumer during April as the economy shed 20.5 million jobs.


    Fed Chairman Jerome Powell speaks on a webcast held by the Peterson Institute on Wednesday at 9 a.m., and he will be watched closely for any new insights on the economy or Fed programs.


    There are just a few earnings releases ahead, but there will be a barrage of economic reports, including consumer and producer inflation, consumer sentiment and most importantly retail sales on Friday.


    Stocks versus bonds

    Stocks were higher in the past week, even as some bond yields touched record lows. Yields move opposite price, and bonds usually move opposite stocks.


    "The stock market is trading the reopening, and the bond market is doubting the vibrant pace of an economic recovery upon the reopening," said Peter Boockvar, chief investment strategist at Bleakley Advisory Group.


    Small cap stocks and tech led the way higher in the past week. The Nasdaq jumped 6% in a week, where it wiped out its losses for the year and turned positive. The small cap Russell 2000 was up 5.5%.


    The S&P 500 was up 3.5% for the week to 2,929, with tech up 6.6% and consumer discretionary stocks up 4.4%.


    The bond market and stock market have both responded to the Fed's programs that put more liquidity into the financial system, with bond rates falling and stocks rising sharply.


    "Stocks just seem to be disconnected from everything else," said Michael Schumacher, director rates at Wells Fargo. Some bond yields, like the benchmark 10-year yield, which impacts many types of loans, were slightly higher ahead of the Treasury's record $96 billion in auctions in the coming week. But the 2-year, at a new low of 0.10%, was trading on concerns about the economy.


    Market pros will look for Powell to comment on market speculation that the Fed could take its benchmark rate to a negative yield. Fed officials have said they have no interest in negative rates, which are being used by central banks in Europe and Japan. But for the first time this past week, traders drove futures on fed funds to show slightly negative rates in contracts starting in November.


    "He could quash negative yields if he wants to," said Schumacher. "The Fed has consistently argued against negative policy rates. Now there's a chance Powell could comment on this. He's commented about it, several times in the last six months."


    Much of the gains in the stock market have been driven by big technology companies with operations that haven't been deeply affected by the coronavirus.


    "Tech was the shutdown trade and small caps are the reopening," said Boockvar, noting small caps are domestically focused and are sensitive to the back-to-work trade.


    Apple joined the reopening trade Friday, when its stock rose after it announced it would reopen some of its U.S. stores.


    "The stock market has sort of a hall pass as the months proceed and things reopen. At some point, that hall pass is going to expire" and the reopenings will have to result in rebound, Boockvar said.


    Investors have been watching for anything that suggests state reopenings are stimulating activity.


    Retail sales Friday will be a big focus and are expected to show sharp decline of 11%, but more like 6% when automobiles and gasoline are removed, he said.


    In the oil market in the past week, crude was up as much as 24% as traders reacted to information that showed gasoline demand picking up around the U.S. States have been opening up at different speeds, and California was the latest to reopen some activity Friday.


    "Some of the reason the market is up because the virus curve is bending, the economic data is showing signs of a bounce. It hasn't here yet but you know it's coming. It's a global phenomenon," said James Paulsen, chief investment strategist at Leuthold Group. He noted that China's export numbers unexpectedly rose in April, for the first time this year.


    Paulsen said he expects stocks to remain in an upswing.


    "There's a lot of value out there if you're outside the high growth in the S&P 500," he said, "When fear is as high as it is, that's typically been a great time to lean toward risk assets. Gold is at a 50-year high relative to commodity prices. People are buying bonds at virtually zero yield. To me, there's fairly defensive behavior and scared attitudes rather than the other way around."


    Strategists say the market could retest its March lows, but a good number say the bottom has been set.


    "I'm getting more confident that we've seen the lows, and we're starting a recovery in the stock market, but I think the volatility is going to stay there, and there will be challenges. I think the general direction is up rather than down at the moment," said Paulsen.


    Paulsen said the fear of reinfection remains, should there be a new wave of the virus. "There's a lot of terrible things that could happen and be terrible for the stock market," he said. "A headline could create an up or down week and then go away again. "


    "I think the rise in the stock market is really more about a lack of sellers. But I don't think there's a lot of buyers. If more people believed this is winding down ... there could be a lot more money that's going to come back into equities, to some extent," Paulsen said.


    Market pros are keeping an eye on yields, ahead of the government's record sized $96 billion in auctions in the coming week for 3- and 10-year notes and 30-year bonds.


    This past week saw the following moves in the S&P:

    (CLICK HERE FOR THE FULL S&P TREE MAP FOR THE PAST WEEK!)

    Major Indices for this past week:

    (CLICK HERE FOR THE MAJOR INDICES FOR THE PAST WEEK!)

    Major Futures Markets as of Friday's close:

    (CLICK HERE FOR THE MAJOR FUTURES INDICES AS OF FRIDAY!)

    Economic Calendar for the Week Ahead:

    (CLICK HERE FOR THE FULL ECONOMIC CALENDAR FOR THE WEEK AHEAD!)

    Sector Performance WTD, MTD, YTD:

    (CLICK HERE FOR FRIDAY'S PERFORMANCE!)
    (CLICK HERE FOR THE WEEK-TO-DATE PERFORMANCE!)
    (CLICK HERE FOR THE MONTH-TO-DATE PERFORMANCE!)
    (CLICK HERE FOR THE 3-MONTH PERFORMANCE!)
    (CLICK HERE FOR THE YEAR-TO-DATE PERFORMANCE!)
    (CLICK HERE FOR THE 52-WEEK PERFORMANCE!)

    Percentage Changes for the Major Indices, WTD, MTD, QTD, YTD as of Friday's close:

    (CLICK HERE FOR THE CHART!)

    S&P Sectors for the Past Week:

    (CLICK HERE FOR THE CHART!)

    Major Indices Pullback/Correction Levels as of Friday's close:

    (CLICK HERE FOR THE CHART!

    Major Indices Rally Levels as of Friday's close:

    (CLICK HERE FOR THE CHART!)

    Most Anticipated Earnings Releases for this week:

    (CLICK HERE FOR THE CHART!)

    Here are the upcoming IPO's for this week:

    (CLICK HERE FOR THE CHART!)

    Friday's Stock Analyst Upgrades & Downgrades:

    (CLICK HERE FOR THE CHART LINK #1!)
    (CLICK HERE FOR THE CHART LINK #2!)

    Market Too Far Ahead of Economy?

    Another 3.2 million Americans filed for unemployment last week bringing the seven-week total to 33.5 million. This is an unprecedented streak for an unprecedented time, and it highlights the significant impact that the coronavirus pandemic shutdown is having. One small positive aspect of this week's number is the fact that it is a decline from the previous reading which lends further support to the possibility that the market's lows of March could be the bottom and that bottom could hold based upon the historical correlation of jobless claims and past market bottoms that we covered in a recent post.

    However, the seven-week total is an unsettling number that suggests the road back to "normal" could be longer than the market appears to currently expect. It is getting increasingly more challenging to envision 33.5 million Americans returning to work as quickly as they left. And with NASDAQ returning to positive for the year in today's trading it may be time to wonder if the market's brisk recovery is possibly too far ahead of the actual economy.

    One early sign that the rally may be getting well ahead of the economy can be seen in the following chart of cumulative daily advance/decline lines for NYSE, NASDAQ, Russell 2000 and the S&P 500. The recent trend since the end of April has been lower while the indexes have managed to move modestly higher. This suggests that fewer and fewer stocks are still participating in the rally. Historically when this persisted the major indexes frequently failed to move meaningfully higher and often turned lower.

    (CLICK HERE FOR THE CHART!)

    Market Gains in Celebration of Mother's Day

    With just a few days remaining to Mother's Day, today's post is also a reminder. Over the last twenty-five years on the Friday before Mother's Day the Dow Jones Industrials have gained ground seventeen times. On the Monday after, DJIA has advanced seventeen times over the same time period. Average gain on Friday has been 0.20% and a respectable 0.36% on Monday. However, in five of the last eight years, the Monday following Mother's Day has been down. Last year, DJIA suffered its worst post Mother's Day loss, off 2.38%.

    (CLICK HERE FOR THE CHART!)

    Group Breadth Improving From a Record Low Base

    After a disastrous late February and early March period, breadth among S&P 500 groups cratered to the point where not a single one of the S&P 500's 24 industry groups were above their 50-day moving average. Before the most recent occurrence, that's something we hadn't seen since early 2019.

    (CLICK HERE FOR THE CHART!)

    While there have been numerous instances in the last few years where every industry group was below its 50-DMA, the most recent period was unique in that it lasted more than four full weeks (21 trading days). Going all the way back to 1990, there has only been one other period where every industry group was below its 50-day moving average for as long as it just was. That was during the depths of the financial crisis in the 21-day stretch ending 11/3/08. It took a bear market of more than a year to finally reach that level back then, but this time around, it took less than two months. Besides that period, there has never been another four-week stretch where every industry group was below its 50-day moving average.

    (CLICK HERE FOR THE CHART!)

    Overall breadth readings have already improved in terms of industry groups above their 50-day moving averages, but at this point, the number of industry groups with rising 50-day moving averages remains extremely depressed at just 8.3% as of midday Friday. Similar to the streak above, during the most recent period every group had a declining 50-day moving average for 26 straight days, and that was also the longest such streak since 2008. Granted, this is a lagging indicator and should improve the longer equities remain around current levels, but it once again serves as a reminder of how steep the declines actually were.

    (CLICK HERE FOR THE CHART!)

    Sector Relative Strength

    Although the S&P 500 (SPY) is down around 1% over the past week, there are two sectors that have made a push higher: Communication Services (XLC) and Technology (XLK). While these moves have left both sectors in overbought territory, a snapshot from our Trend Analyzer tool shows that Tech's rally has brought it into the green YTD.

    (CLICK HERE FOR THE CHART!)

    Technology's outperformance is nothing new. As shown in the relative strength charts from our Sector Snapshot below, Technology has been a serial outperformer versus the S&P 500 for pretty much all of the past year (a rising line indicates outperformance versus the S&P 500 and vice versa). As for the other sectors, Health Care has also seen some drastic outperformance over the past few months. Communication Services and Consumer Discretionary have also seen some outperformance in recent weeks. Contrary to Technology, Energy, Financials, Industrials, and Materials have all been consistent underperformers over the past year.

    (CLICK HERE FOR THE CHART!)

    Performance on Earnings Days

    Roughly 1,300 companies have reported since the start of earnings season on 4/13 when the first of the big banks kicked things off. For those stocks that have beaten EPS estimates, the reaction has not been as strong as past years with just a 9 bps difference between this earnings season and all seasons since 2001. On the other hand, those that have missed EPS have not been as badly punished dropping 0.86% compared to an average drop of 3.56% since 2001. For all stocks, the average gain of 0.79% this earnings season is much stronger than the 0.06% gain of all other seasons.

    (CLICK HERE FOR THE CHART!)

    With stock price reactions being generally positive this season, most of the gain has come at the open. Stocks reporting earnings have gapped up an average of 1.24%. But intraday they have tended to sell-off, averaging a 0.44% decline from open to close.

    (CLICK HERE FOR THE CHART!)

    STOCK MARKET VIDEO: Stock Market Analysis Video for Week Ending May 8th, 2020

    (CLICK HERE FOR THE YOUTUBE VIDEO!)

    STOCK MARKET VIDEO: ShadowTrader Video Weekly 5.10.20

    (CLICK HERE FOR THE YOUTUBE VIDEO!)

    Here are the most notable companies (tickers) reporting earnings in this upcoming trading week ahead-


    • $UAA
    • $AMAT
    • $CLF
    • $MAR
    • $CSCO
    • $CPE
    • $JD
    • $INO
    • $KOS
    • $ON
    • $TLRY
    • $CAH
    • $ACB
    • $AN
    • $WIX
    • $SDC
    • $GBDC
    • $NCLH
    • $DUK
    • $NBEV
    • $ICPT
    • $SPG
    • $CYBR
    • $DDOG
    • $CEVA
    • $MYL
    • $CHH
    • $HMC
    • $ET
    • $LOGI
    • $OAS
    • $NVAX
    • $ZBH
    • $PRTK
    • $ABUS
    • $GWPH
    • $VCTR
    • $SALT
    • $WVE
    • $GNC
    • $AMRX
    • $ETR
    • $NOG

    (CLICK HERE FOR NEXT WEEK'S MOST NOTABLE EARNINGS RELEASES!)
    (CLICK HERE FOR NEXT WEEK'S HIGHEST VOLATILITY EARNINGS RELEASES!)
    (CLICK HERE FOR THE MOST NOTABLE EARNINGS RELEASES BEFORE MONDAY'S OPEN!)

    Below are some of the notable companies coming out with earnings releases this upcoming trading week ahead which includes the date/time of release & consensus estimates courtesy of Earnings Whispers:


    Monday 5.11.20 Before Market Open:

    (CLICK HERE FOR MONDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!)

    Monday 5.11.20 After Market Close:

    (CLICK HERE FOR MONDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK #1!)
    (CLICK HERE FOR MONDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK #2!)

    Tuesday 5.12.20 Before Market Open:

    (CLICK HERE FOR TUESDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!)

    Tuesday 5.12.20 After Market Close:

    (CLICK HERE FOR TUESDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!)

    Wednesday 5.13.20 Before Market Open:

    (CLICK HERE FOR WEDNESDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!)

    Wednesday 5.13.20 After Market Close:

    (CLICK HERE FOR WEDNESDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!)

    Thursday 5.14.20 Before Market Open:

    (CLICK HERE FOR THURSDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!)

    Thursday 5.14.20 After Market Close:

    (CLICK HERE FOR THURSDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!)

    Friday 5.15.20 Before Market Open:

    (CLICK HERE FOR FRIDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!)

    Friday 5.15.20 After Market Close:

    (CLICK HERE FOR FRIDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!)

    NONE.


    Under Armour, Inc. $9.98

    Under Armour, Inc. (UAA) is confirmed to report earnings at approximately 6:55 AM ET on Monday, May 11, 2020. The consensus estimate is for a loss of $0.19 per share on revenue of $961.78 million and the Earnings Whisper ® number is ($0.18) per share. Investor sentiment going into the company's earnings release has 4% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 480.00% with revenue decreasing by 20.17%. Short interest has decreased by 29.1% since the company's last earnings release while the stock has drifted lower by 41.6% from its open following the earnings release to be 42.3% below its 200 day moving average of $17.29. Overall earnings estimates have been revised lower since the company's last earnings release. On Thursday, May 7, 2020 there was some notable buying of 7,725 contracts of the $9.50 put expiring on Friday, May 15, 2020. Option traders are pricing in a 14.6% move on earnings and the stock has averaged a 14.7% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    Applied Materials, Inc. $53.81

    Applied Materials, Inc. (AMAT) is confirmed to report earnings at approximately 4:00 PM ET on Thursday, May 14, 2020. The consensus earnings estimate is $0.92 per share on revenue of $4.25 billion and the Earnings Whisper ® number is $0.96 per share. Investor sentiment going into the company's earnings release has 70% expecting an earnings beat The company's guidance was for earnings of $0.98 to $1.10 per share. Consensus estimates are for year-over-year earnings growth of 31.43% with revenue increasing by 20.09%. Short interest has increased by 26.9% since the company's last earnings release while the stock has drifted lower by 19.4% from its open following the earnings release to be 0.1% above its 200 day moving average of $53.76. Overall earnings estimates have been revised lower since the company's last earnings release. On Tuesday, April 28, 2020 there was some notable buying of 1,768 contracts of the $72.50 call expiring on Friday, October 16, 2020. Option traders are pricing in a 7.4% move on earnings and the stock has averaged a 3.5% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    Cleveland-Cliffs Inc $4.82

    Cleveland-Cliffs Inc (CLF) is confirmed to report earnings at approximately 7:00 AM ET on Monday, May 11, 2020. The consensus estimate is for a loss of $0.18 per share on revenue of $367.81 million and the Earnings Whisper ® number is ($0.23) per share. Investor sentiment going into the company's earnings release has 41% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 125.00% with revenue increasing by 134.27%. Short interest has decreased by 1.1% since the company's last earnings release while the stock has drifted lower by 34.4% from its open following the earnings release to be 30.0% below its 200 day moving average of $6.89. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, May 8, 2020 there was some notable buying of 3,060 contracts of the $4.00 put and 2,389 contracts of the $6.00 call expiring on Friday, June 19, 2020. Option traders are pricing in a 13.2% move on earnings and the stock has averaged a 4.9% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    Marriott International Inc. $87.17

    Marriott International Inc. (MAR) is confirmed to report earnings at approximately 6:15 AM ET on Monday, May 11, 2020. The consensus earnings estimate is $0.90 per share on revenue of $4.25 billion and the Earnings Whisper ® number is $0.83 per share. Investor sentiment going into the company's earnings release has 29% expecting an earnings miss The company's guidance was for earnings of $1.47 to $1.50 per share. Consensus estimates are for earnings to decline year-over-year by 36.17% with revenue decreasing by 15.20%. Short interest has increased by 116.6% since the company's last earnings release while the stock has drifted lower by 25.5% from its open following the earnings release to be 28.7% below its 200 day moving average of $122.26. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, May 1, 2020 there was some notable buying of 2,686 contracts of the $70.00 put expiring on Friday, May 15, 2020. Option traders are pricing in a 8.6% move on earnings and the stock has averaged a 2.2% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    Cisco Systems, Inc. $42.99

    Cisco Systems, Inc. (CSCO) is confirmed to report earnings at approximately 4:05 PM ET on Wednesday, May 13, 2020. The consensus earnings estimate is $0.71 per share on revenue of $11.88 billion and the Earnings Whisper ® number is $0.73 per share. Investor sentiment going into the company's earnings release has 58% expecting an earnings beat The company's guidance was for earnings of $0.79 to $0.81 per share. Consensus estimates are for earnings to decline year-over-year by 10.13% with revenue decreasing by 8.32%. Short interest has decreased by 8.2% since the company's last earnings release while the stock has drifted lower by 8.8% from its open following the earnings release to be 5.9% below its 200 day moving average of $45.70. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, May 8, 2020 there was some notable buying of 26,151 contracts of the $50.00 call expiring on Friday, May 29, 2020. Option traders are pricing in a 6.4% move on earnings and the stock has averaged a 5.9% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    Callon Petroleum Company $0.81

    Callon Petroleum Company (CPE) is confirmed to report earnings at approximately 5:00 AM ET on Monday, May 11, 2020. The consensus earnings estimate is $0.15 per share on revenue of $344.75 million. Investor sentiment going into the company's earnings release has 48% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 6.25% with revenue increasing by 125.26%. Short interest has decreased by 3.4% since the company's last earnings release while the stock has drifted lower by 64.0% from its open following the earnings release to be 76.5% below its 200 day moving average of $3.45. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, May 8, 2020 there was some notable buying of 666 contracts of the $3.00 put expiring on Friday, June 19, 2020. The stock has averaged a 7.2% move on earnings in recent quarters.

    (CLICK HERE FOR THE CHART!)


    Kosmos Energy Ltd. $1.49

    Kosmos Energy Ltd. (KOS) is confirmed to report earnings at approximately 2:00 AM ET on Monday, May 11, 2020. The consensus estimate is for a loss of $0.14 per share on revenue of $234.50 million and the Earnings Whisper ® number is ($0.17) per share. Investor sentiment going into the company's earnings release has 14% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 133.33% with revenue decreasing by 20.99%. Short interest has increased by 38.8% since the company's last earnings release while the stock has drifted lower by 68.0% from its open following the earnings release to be 69.3% below its 200 day moving average of $4.85. Overall earnings estimates have been revised lower since the company's last earnings release. The stock has averaged a 7.5% move on earnings in recent quarters.

    (CLICK HERE FOR THE CHART!)


    JD.com, Inc. $46.78

    JD.com, Inc. (JD) is confirmed to report earnings at approximately 5:00 AM ET on Friday, May 15, 2020. The consensus earnings estimate is $0.11 per share on revenue of $19.17 billion and the Earnings Whisper ® number is $0.18 per share. Investor sentiment going into the company's earnings release has 71% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 59.26% with revenue increasing by 6.25%. Short interest has decreased by 18.0% since the company's last earnings release while the stock has drifted higher by 13.0% from its open following the earnings release to be 31.7% above its 200 day moving average of $35.52. On Friday, May 1, 2020 there was some notable buying of 20,424 contracts of the $41.50 call expiring on Friday, May 22, 2020. Option traders are pricing in a 8.2% move on earnings and the stock has averaged a 7.2% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    ON Semiconductor Corporation $17.12

    ON Semiconductor Corporation (ON) is confirmed to report earnings at approximately 6:00 AM ET on Monday, May 11, 2020. The consensus earnings estimate is $0.15 per share on revenue of $1.30 billion and the Earnings Whisper ® number is $0.15 per share. Investor sentiment going into the company's earnings release has 43% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 65.12% with revenue decreasing by 6.25%. Short interest has decreased by 8.4% since the company's last earnings release while the stock has drifted lower by 20.2% from its open following the earnings release to be 10.6% below its 200 day moving average of $19.14. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, May 8, 2020 there was some notable buying of 14,949 contracts of the $18.00 call and 12,073 contracts of the $15.00 put expiring on Friday, May 15, 2020. Option traders are pricing in a 12.6% move on earnings and the stock has averaged a 9.6% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    Inovio Biomedical Corp $10.86

    Inovio Biomedical Corp (INO) is confirmed to report earnings at approximately 4:05 PM ET on Monday, May 11, 2020. The consensus estimate is for a loss of $0.23 per share on revenue of $1.55 million and the Earnings Whisper ® number is ($0.25) per share. Investor sentiment going into the company's earnings release has 52% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 23.33% with revenue decreasing by 45.23%. Short interest has increased by 28.3% since the company's last earnings release while the stock has drifted higher by 35.9% from its open following the earnings release to be 153.3% above its 200 day moving average of $4.29. Overall earnings estimates have been revised higher since the company's last earnings release. On Friday, May 8, 2020 there was some notable buying of 25,511 contracts of the $13.50 call expiring on Friday, May 15, 2020. Option traders are pricing in a 24.0% move on earnings and the stock has averaged a 6.6% move in recent quarters.

    (CLICK HERE FOR THE CHART!)


    DISCUSS!

    What are you all watching for in this upcoming trading week?


    I hope you all have a wonderful weekend and a great trading week ahead r/StockMarket.

    submitted by /u/bigbear0083
    [link] [comments]

    Mark Cuban’s Secret Shopper Study Finds That 96% of Dallas Businesses Don’t Comply With Reopening Guidelines. This is going to get bad.

    Posted: 09 May 2020 06:29 AM PDT

    "According to the findings posted to Cuban's website, only 36 percent of all businesses included in the study that were allowed to reopen on May 1 actually chose to open their doors. Of those businesses, a staggering 96 percent failed to comply with all of the Open Texas guidelines. The shoppers observed that restaurants were more likely to comply with some requirements, like separating tables and asking employees to wear masks, than they were with guidelines like offering single use condiments or contactless payment." Definitely check out the full study.

    If this trend continues as states reopen, it's bad news for the economy.

    To mostly everyone, these staggering unemployment numbers don't feel real yet. People think this pandemic is just going to blow right over, and life is just weeks away from returning to normal. Optimism is especially high because those $1,200 stimulus checks are three times the amount of cash over 40% of American's have in their savings account on any given day. Plus, Unemployment is paying millions of people more than they regularly make at their jobs. A very large portion of Americans probably feel more "financially secure" right now than any other time in recent memory. Now, interest rates are almost 0% and people are deciding it's a great time to buy a car or house. However, as economic activity starts trending down from lack of public confidence in local governments ability to stop the Coronavirus, that financial security will evaporate extremely quickly.

    People are ready to return to normal, and the market is reflecting that. We saw it in economic activity this last week with all the reopenings. However, The fact of the matter is a virus with a .5%-1% death rate is spreading rapidly, and it's going to have to infect 220,000,000 Americans before it stops, unless we stop it first. That's 1 person in every 10th family dead (assuming each family has 16 people across 3-4 generations) . This virus also does permanent damage to the lungs, heart, kidneys, and/or the central nervous system in 10% of cases, and will require lifetime treatment (1 in every 4 families). source

    We dont have adequate testing, not enough people are wearing masks, and Mark Cuban's study in Dallas showed less than 4% of businesses were following every public health guideline in their reopened economy. The longer people take to realize what's going on and react accordingly, the harder the economy is going to crash when they do. We're in the second inning of a nine inning stretch, and If businesses don't start following these health guidelines in the next two weeks, things are going to get really messy, and people will stay home on their own. It's a mathematical certainty.

    Edit: I'm trying to explain the bubble our economy is currently in, and why it's about to burst. The stock market is tied to the economy (i know right?), and when people start pulling money out of their 401ks and missing credit card payments, markets will crash. What happens when all that stock companies bought back drops in value by 50%? What happens when credit unions start going insolvent?

    Edit Edit: I don't believe lockdowns are what would cause this either. The economy will grind to a halt on its own once Cov19 is widespread in rural and suburban communities. I actually believe the lockdowns and quick action by congress is what instilled the market confidence in the first place. Doing the reopening properly would instill even more confidence.

    submitted by /u/jaboyles
    [link] [comments]

    People who sold around a month ago expecting the worst, did you get back in? If so when and what specifically changed your mind?

    Posted: 09 May 2020 04:41 PM PDT

    I saw a few posts awhile back in March/April where people said they were selling everything because a market crash was imminent. I'd guess that a crash is maybe more likely now, but in the meantime the market has gone up substantially so how has it been for those who sold off? Have you gotten back in and what was your thought process or how has in changed in the last couple months?

    submitted by /u/rapunzelsasshair
    [link] [comments]

    Most Anticipated Earnings Releases for the trading week beginning May 11th, 2020

    Posted: 09 May 2020 08:47 AM PDT

    An important lesson that I’ve learned the hard way

    Posted: 09 May 2020 11:23 AM PDT

    You can't outsmart the market

    So you've scoured the troves of company information looking for a diamond in the rough. You find it. It's an obscure company that been around for decades. It has a microscopic debt to equity ratio. It has shown double digit Y/Y growth every quarter. It has an EPS of 5 quadrillion and and P/E that makes it too good to pass up. The value of their tangible assets is greater than the market cap. In addition it seems like the economic trends will help this company to grow even faster in the future and increase profit margins.

    So of course, you invest. You hold it for a year and do you know how much money you've made? Zero, nada, nothing. Why? Because the company doesn't pay dividends and the stock is worth only what other people say it's worth. If big institutional investors don't think it's a good buy, then it's not. Not because they are brilliant oracles predicting what it will be worth, but because it's they that actually decide what it will be worth at the end of the day. They don't predict the market, they are the market. Any correct predictions are only self-fulfilling prophecies. In other words, finding an obscure diamond in the rough only pays off if other people find it too. The more the merrier. You don't win by outsmarting the market.

    You need to be exactly as dumb as everyone else, you just need to be faster

    So how do you win? By investing in meme stocks of course. Don't denigrate the meme stocks. Don't look down on them. Don't think, has everyone lost their damn minds? No. Instead go in on meme stocks, just make damn sure that you're early. And keep in mind that you don't want to be there when people figure out that they aren't really that great. So don't be afraid to take profits. Even if it means leaving some potential on the floor. Buy early. Sell regularly as they go up.

    Does it really have to be a meme stock?

    No, of course not. But the point is that if no one else is looking at a sector of the economy, you shouldn't either. You should at least be looking in the same industries as the bulk of investors. You want to be the first not the only. It's as much psychology as finance. What will be attractive to other investors? It needs to be something top of mind.

    Do the facts even matter?

    Does EPS matter? Only when people decide it does. How about Debt to Equity? Once again only when people decide it does, or if the company is at risk of bankruptcy. Y/Ys? Yes, as long as people still think it's the most important factor. If not, like say during a shutdown caused by a global pandemic where people are understanding of lost revenue...meh.

    P.S. I'm in no way an expert. This is just a lesson I've learned in my limited experience.

    submitted by /u/jckonln
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    Thoughts on Fujifilm?

    Posted: 09 May 2020 04:29 PM PDT

    They've sent their covid drug to over 40 countries for trials and are ramping up production. They've also developed a chemical that makes automated coronavirus testing results available in 75 minutes. Still roughly $10 below its 52 week highs after spikes in March and April.

    submitted by /u/aykbq2
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    Outstanding Shares and Stock Floats

    Posted: 09 May 2020 10:08 AM PDT

    Every morning that the market is open I share a morning watchlist on social media with info such as news headlines, support levels, resistance levels, and number of outstanding shares for stocks that are making big moves. I get asked pretty frequently why I include the number of outstanding shares and how it is relevant for day trading stocks. I wanted to make this post to explain the importance of it and share how I use it in my own trading. Hopefully after reading this you'll see why I share this data on my watchlists and you'll check for this number before each of your trades because it can be very beneficial and is a simple way to help manage your risk in the market.

    Let's start with the obvious question you may have... what are outstanding shares?

    The number of outstanding shares is simply the total number of shares a publicly traded company has. This includes the shares that you and I can trade as retail traders, the shares that are traded and held by institutions/hedge funds/banks, and even the shares that are owned by company insiders. Anyone can very easily look up the number of outstanding shares a company has. You can do this in your trading platform, on websites like yahoo finance or finviz, or you can look into the company's most recent earnings report and see the number directly from their SEC filings. The screenshot below shows where the number of outstanding shares is located for $AAPL in the thinkorswim mobile platform on the right shows the same number located on the first page of $AAPL's most recent earnings report filing. You'll find this info in the same location for any spot, $AAPL was just use for this example.

    https://imgur.com/a/cTAkHue

    Outstanding shares differs slightly from a stock's float, but the way that they affect the stock can go hand in hand. A stock's float is the number of shares available to be traded by the public, like you and I. You can find a stock's float by subtracting the total number of closely held shares (by company insiders, employees, etc.) from the total number of outstanding shares. Although traders seem to talk more about a stock's float than the number of outstanding shares, I personally like to focus more on the outstanding shares because it can be difficult to find accurate float data in a limited amount of time.

    The reason for that is because a company does not directly state their float data in their SEC filings like they do their outstanding shares. This means that in order to get accurate float data, you have to research and find the number of closely held shares by digging through filings and then subtract that number from the total number of outstanding shares. You can look for a stock's float on 3 different websites like yahoo finance, finviz, and marketwatch and many times you'll end up with 3 completely different numbers.

    The number of outstanding shares may be more commonly used for calculating a company's market capitalization, but it's definitely a valuable number for short-term trading as well. This number can be thought of as the supply, and the volume for the stock can be thought of as the demand. When there is a low supply (in this case meaning a low float or low amount of shares outstanding) and high demand, generally there will be a larger amount of volatility in that stock compared to one with a larger supply.

    For example, you can look at the number of shares outstanding for stocks with the largest % gain on any given day, and you will find that a large majority of them have less than 100 million shares outstanding. Now, 100 million isn't a magical number for picking big runners, but stock's with many more shares outstanding than that tend to have less volatility and less potential for huge runs in my experience. In fact, if you look back on the biggest supernovas from the past few years, you'll notice that they all had under 100 million shares outstanding, and many of them even having less than 10 million shares. In the screenshot below you can see the huge spike in the stock $DRYS from 2017 when it went from under $5 to over $100 in just a few days. Since then $DRYS has done many reverse splits and offerings, but at the time it had a very low float of only around 1 million shares.

    https://imgur.com/a/H3gEdyq

    As you can see, volatility doesn't just work on the upside though. $DRYS, like many big runners, came down just as quickly as it went up. That's why trading low floats with higher volatility can create a higher risk, higher reward situation. With that being said, one of the ways I use the number of outstanding shares is to give myself an idea of the stock's expected volatility. If it has a low supply, I most likely will trade a smaller-than-usual position size to reduce my risk in the trade that is expected to be highly volatile.

    In my opinion, this is especially important with longer-term trades and investments. Generally the goal of an investment is to profit from a slow and steady rise over a long period of time. If you're investing in stocks with a low number of outstanding shares, you'll most likely have to deal with much more volatility and larger drawdowns in your positions. Aside from the dilution, poor financials, and frequent pump and dumps, this is one of the reasons that penny stocks do not make good investments, even though they can be great for short-term trading and scalping.

    submitted by /u/mtmtrader
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    Wisdom the Trump kind. Has it ever ended well?

    Posted: 09 May 2020 07:46 PM PDT

    So reading reports about what is going on in the White House. All the financial Republicans, talking heads and and cheer leaders are present. Trump is going to the the one thing he does best. He is going to punt and make some completely insane off the wall thing he think will FIX everything but get the STOCK MARKET some Rocket fuel. Honestly searching for the best response of what he could birth as a brain fart to get him out of this

    submitted by /u/AppleTree98
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    very noob question

    Posted: 09 May 2020 03:00 PM PDT

    I have done a few covered calls recently to just try them out and see it in action. Mainly very small plays that in hindsight never stood a chance but I only lost maybe 50 bucks.

    Anyways, I am wondering what it exactly means, what the out comes are for this and if its even something one would go for in this particular scenario. When the strike you buy is (example) $100 and is worth say .45 and the strike you sell is $101 is worth .48.

    Sorry if this is a bad question or if I'm not explaining myself well enough.

    Thanks for any help in understanding.

    submitted by /u/vontsont
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    The new age of Monetary Policy: an in-depth analysis of Federal Reserve Policy in the 2008 and 2020 financial crises

    Posted: 08 May 2020 10:44 PM PDT

    The Evolution of Monetary Policy: Age of the Bailout

    In the years leading up to 2008 Wall Street had been celebrating massive gains; top finance executives were awarded up to $53 billion dollars in total compensation in 2007. Lloyd Blankfein, former CEO of Goldman Sachs, made $68 million himself. These profits were the result of financial innovations and financial derivatives, specifically mortgage backed securities (MBS). A mortgage backed security is an asset backed security which is secured by a collection of mortgages. The mortgages are aggregated and securitized so that investors can buy them and receive periodic payments similar to a bond's coupon payment. Mortgage backed securities were doing so well in the years leading up to 2008 that lenders were running out of people with good credit to lend to. Everyone was buying and building houses so much so that the real estate market became a bubble and all the prices inflated.

    At first everyone was celebrating the gains in housing prices, since price increases generally meant profits for home investors, mortgage brokers, and even big banks. Not too long after the party, the real estate bubble burst. Everyone was immediately impacted; mortgage giants, Fannie Mae and Freddie Mac, were on the verge of bankruptcy. Some of the biggest investment banks in the world, each having upwards of $10 trillion assets under management, such as Bear Stearns, Lehman Brothers, and Merrill Lynch were about to collapse. The whole financial sector was in shambles. "In a period of 18 months, Wall Street had gone from celebrating its most profitable age to finding itself on the brink of an epochal devastation." Banks were heavily involved with mortgage securities. Most of these securities were financial derivatives which means they derive their price from an underlying asset. "Banks were creating increasingly complex products, many levels removed from the underlying asset."

    The first bank to really be shallow waters was Bear Stearns. Bear Stearns was a global investment bank whose main area of business was capital markets, wealth management, and investment banking. In 2008 Bear Stearns had roughly $13 trillion in derivative financial instruments, $2 trillion of which were in options and futures contracts. The company had a highly leveraged balance sheet with a lot of illiquid assets that were potentially worthless. Bear Stearns was the seventh largest securities firm in the world. Since their business was highly intertwined with other huge financial institutions, their potential collapse would be detrimental for the global economy.

    U.S. Treasury secretary Hank Paulson knew that if Bear Stearns and Lehman Brothers collapsed there would be a domino effect across the financial sector and other huge financial institutions such as Citigroup, Merrill Lynch, and others would fail while consumers would start to lose confidence in the banking sector, more banks would be subject to bank-runs. In order to prevent the worst from occurring the U.S. Treasury Secretary put together a task force which included Jamie Dimon, CEO of J.P. Morgan Chase, Ben Bernake, Chairmen of the United States Federal Reserve, and Tim Geithner, Head of the New York Fed. After pondering possible loans and other solutions in order to rescue Bear Stearns, they deemed that there was no way to save Bear Stearns. This is not because of insufficient capital but because confidence had been lost in Bear Stearns. J.P. Morgan Chase ended up acquiring Bear Stearns for $10 a share, much less than their 52 week high of $133 per share.

    After Bear Stearns fell the next bank about to collapse was Lehman Brothers. Lehman Brothers was the fourth largest investment bank in the United States. Its CEO at the time Richard Fuld blamed the declining stock price on short sellers. However the short sellers argued that the way Lehman viewed non-liquid assets such as mortgages was disturbing. Fuld refused to accept that the bank essentially had a bunch of junk mortgage backed securities on their balance sheets and tried to solve Lehman's liquidity problem with more cash. He reached out to Warren Buffett to try and secure a loan, but Buffett said it was too risky. Richard even reached out to the U.S. government for a bailout, but Treasury Secretary at the time Henry Paulson refused to bail out Lehman with public tax payer money and instead said that the bank must secure funding from the private sector. Paulson gathered all the CEO's of major banks and told them to come up with a solution for saving Lehman Brothers. Likely contenders to buy out Lehman Brothers were Bank of America and British bank, Barclays. However neither of which were willing to take on the Lehman's real estate assets which were basically worth half of what Lehman was valuing them at. After failing to secure capital, or merge with another bank Lehman Brothers filed for chapter eleven bankruptcy protection on September 15th, 2008. Chapter eleven bankruptcy protected some creditors and most employees. In the bankruptcy agreement, Lehman Brothers' shareholders paid the ultimate price and watched their fortunes from a year prior be worth a fraction of what they were.

    At the same time Lehman Brothers was crashing, insurance giant American International Group (AIG) and mortgage giants Fannie Mae and Freddie Mac were tumbling down cliffs of their own. James Lockhart, head of the Federal Housing Finance Agency (FHFA) issued a plan to make the two mortgage giants into a conservatorship as government sponsored enterprises. The two mortgage companies were now and still are U.S. government enterprises who facilitate the secondary mortgage market. The United States Treasury Secretary, Hank Paulson, as well as Federal Reserve Chairman, Ben Bernanke, both agreed with the housing agency's decision.

    On the other hand, AIG executives were assuring everyone that the company was in sound financial standing. At the time, AIG had $1 trillion in assets and roughly $40 billion in cash. In addition, executives argued that they had an extremely profitable business supporting insurance on collateral debt obligations (CDO). A CDO is a financial tool that banks use to package individual homeowners, credit card, and auto loans into securities sold to investors on the market. CDOs at the time were mainly used to refinance mortgage backed securities.. Most of AIG's business was traditional insurance products such as health, life, and home insurance. However during the real estate bubble the company began taking a lot of risks in the form of credit default swaps (CDS). A CDS is a financial exchange agreement where the issuer of the CDS will compensate the buyer if the buyer's asset defaults (similar to investment insurance). Essentially investors were buying credit default swaps as insurance for their mortgage backed securities. Once the real estate bubble popped, everyone came to claim insurance for their MBS that just went bankrupt. AIG had over $500 billion in subprime mortgages on their balance sheet. Its officials were revaluing credit default swaps and losses started to pile up at AIG. By May of 2008 AIG had suffered a first quarter loss of roughly $8 billion, their largest loss ever. Hank Paulson knew that if AIG went bankrupt it would trigger the collapse of financial institutions that bought these credit default swaps.

    As the MBS tied to the swaps defaulted, AIG was forced to come up with the capital to repay their investors. Shareholders started dumping their shares which made it even more difficult for AIG to produce the capital it needed. Even though they had the assets on their balance sheet to cover the losses, AIG could not liquidate them fast enough before the swaps were due. It was clear that they were about to go bankrupt. Hank Paulson and Ben Bernanke did not want AIG's huge influence to hurt lower and middle class families since AIG sold lots bonds, annuities, and insurance products to these people. An AIG bankruptcy would've hurt lower and middle class families as well as the whole financial sector which owned credit default swaps issued by AIG. They were just too big to fail. So the Federal Reserve along with the U.S. Treasury planned a bailout of an $85 billion loan to AIG. To put that loan amount into perspective, "Eighty-five billion dollars was more than the annual budget of Singapore and Taiwan combined; who could understand a figure that size."

    The loan itself was not enough to calm the markets. Investors were left puzzled as to why the federal government would bailout one company and not the other. What were the rules for a bailout? Did Hank Paulson's background as a top executive at Goldman Sachs have anything to do with the government allowing Lehman Brothers, a competitor of Goldman, to collapse? These questions forced Hank Paulson, Ben Bernanke, and Tim Geithner, president of the New York Federal Reserve Bank, to come up with a solution to calm confusion. Now with the whole financial sector on the verge of collapsing the Treasury and Federal Reserve came up with a fiscal policy to purchase toxic assets from nine of the largest financial institutions in order to stabilize them. The institutions include J.P. Morgan, Goldman Sachs, Morgan Stanley, Citigroup, Wells Fargo, Bank of New York Mellon, Merrill Lynch, Bank of America, and State Street Corp. The program to bail them out was known as TARP. However congress was not too attached to the idea of bailing out Wall Street. Republicans saw a bailout as socialism creeping into the United States, and Democrats saw it as Paulson bailing out his Wall Street buddies. Congress voted against TARP and the Dow Jones Industrial Average fell roughly 800 points that day.

    Paulson, Bernanke, and Geithner went back to the drawing board. Now desperate for a solution Paulson decided to follow the advice of his assistant Neel Kashkari, which was to purchase equity in the nine largest banks in the United States. Paulson reached out to Sheila Bair who was the head of the Federal Depositors Insurance Corporation (FDIC) and told her about the Treasury Department's new plan. Sheila agreed to increase the nine bank's coverage limit.

    Without wasting any time Hank Paulson, Treasury Secretary of the United States, called all the nine executives together for a meeting at the NY Federal Reserve. "It was the first time - perhaps the only time - that the nine most powerful CEOs in American Finance and the people who regulate them would be in the same room at the same time." Without knowing what the meeting was about, the CEO's of all nine banks had shown up. To stress the severity and seriousness of the meeting, Paulson had brought along with him the Chairman of the Federal Reserve, the president of the NY Fed, and The head of the FDIC. Paulson unveiled his plan to purchase up to $250 million in preferred stock in the leading banks in order to stabilize them and restore confidence. He strong armed all of them into taking the deal even though a few of them claim that they did not need the capital, such as Wells Fargo and J.P. Morgan. He also informed the banks that the collapse of Lehaman Brothers will spillover into other banks, Merrill Lynch was of most concern. Paulson agreed to let Merill get bought out by Bank of America in order to save them. They were sold to Bank of America for $29 per share or $50 billion far from their 52 week high of $88 per share. The banks had agreed to the deal and so did Congress on October 3rd, 2008 President George Bush signed the TARP program into law. The program normalized the big banks and brought back investor confidence in Wall Street.

    The following year, President Barack Obama introduced legislation that would transform the whole financial regulatory system. This act was known as the Dodd-Frank Wall Street Reform and Consumer Protection Act. One specific provision known as the Volker rule forbids banks from making speculative investments that do not benefit their consumers. This type of overhaul has not been seen in the U.S. financial system since the Great Depression of 1929. In regards to the subprime mortgage crisis, the United States' Congress, Treasury, and Federal Reserve acted appropriately however they should have acted more quickly and effectively like Jerome Powell's Federal Reserve has during the COVID-19 crisis.

    Some say because of the catastrophe in 2008 and the lessons we have learned, the U.S. The Treasury and Federal Reserve acted the way they did in 2020. Thus far, they both have combated the current financial market crisis with immediate action. If the Federal Reserve and Treasury could've bailout Bear Stearns, Lehman, AIG, and Merrill Lynch the way that they bailed out Boeing, that would have been the best case scenario. In March of 2020 Boeing Co. the airplane manufacturer went to Washington with its hands out begging for a bailout. The company had spent $50 billion on stock repurchases within the past year and now was asking for a $60 billion bailout. Instead of giving the company a direct handout, the Federal Reserve boosted liquidity in the credit markets by purchasing corporate bonds, thus, Boeing was able to secure $25 billion from private investors via the corporate bond market and withdrew its original request for a government bailout. Despite the 33 million unemployed, many people are applauding Jerome Powell and Steven Mnuchin for quickly passing emergency monetary policy measures. Like 2008, these policy measures have insulated the financial markets from total ruin.

    Author: #$%^#^%, Economist

    Editor: @#$%!^&*, Attorney

    Any constructive criticism, feedback, and opinions are greatly appreciated.

    submitted by /u/SwaggyRaggy
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    Stock valuation table

    Posted: 09 May 2020 01:07 PM PDT

    Hey everyone. So I was going through a bunch of different stocks using my method for intrinsic value calculation and put together a spreadsheet of them all and thought I would share. This is all of them that I have done so far (it wouldn't let me copy and paste so here's a view only link to my Google Sheet):

    https://docs.google.com/spreadsheets/d/1DGAodDD5Sbv8njcR12Yacur6oLf0Sdlxc8TkZKSVXJU/edit?usp=sharing

    I have a table at the beginning with all of the current prices and intrinsic value calculations and then a sheet for every individual calculation.

    (For the mods: This is a link to a spreadsheet with my calculations and there is no possible way for me to profit off of this so I think it should be allowed.)

    submitted by /u/rschechter21
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    NVDA | Will NVIDIA Get a Boost From New Gaming Laptops? March was a record quarter for digital spending on games.

    Posted: 09 May 2020 09:16 AM PDT

    March was a record quarter for digital spending on games, according to SuperData. NVIDIA just launched its new RTX Super gaming laptops through its manufacturing partners. The high level of engagement among popular titles such as Activision Blizzard's Call of Duty: Warzone, during the COVID-19 crisis is likely to drive plenty of demand for new gaming hardware, despite the slowdown in the economy.

    The latest market share data from Jon Peddie Research shows that NVIDIA has held its dominant position in the discrete graphics card market. AMD's share ticked up one point to 27% in the fourth quarter, but NVIDIA is still maintaining a wide lead with a 73% share.

    [Source: The Motley Fool found via Beeken io]

    submitted by /u/RR_Davidson
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    Facebook and Netflix still buys here?

    Posted: 09 May 2020 02:36 PM PDT

    Strategy Analysis

    Posted: 09 May 2020 06:26 AM PDT

    I am trying to invest my money on an ongoing basis.

    • I have divided my money into 10. I have 10R
    • I analyze the stock market and decide the positions with high volume stocks daily.
    • I have around 20 picks and shortlist them due to their daily candlestick patterns
    • Every investment is at the size of R.
    • I place a stop loss at r/10
    • I place a take profit at r/200
    • Every time I make a profit I automatically open a new position.
    • I try not to leave the money in the market and close it before the day closes if I am profiting from the trade.

    I would love to get feedback on this style.

    Thanks, stay safe

    PS: I do use an automation system to reopen the positions on an ongoing basis. Every time I lose 10 percent I do reevaluate my position.

    submitted by /u/rifaterdemsahin
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    Question on index funds

    Posted: 08 May 2020 11:52 PM PDT

    Im 16 and learning about the stock market so i dont have a good understanding for economy, businesses and stock of any kind. As many of the sources ive read most suggested index funds as of an investment for average people. Correct me if im wrong but i see little to no benefit of index funds. First lets compare ivesting in index funds compare to investing in big, credible companies with a buy and hold strategy ie apple, tesla, amazon all of them has a high growth rate beat index funds by a large margin with low amount of risk since these company most likely wont go down by any means. Second the reason most go for index funds for its low risk but as far as i know bank saving account hold a 6.6 to even 8% with no taxes and less risk than index funds so whats the point of it ( i live in vietnam and this is a reference to vietnamese banks ) . I appreciate all the feedback and as my english is mediocre since im not a native woth little knowledge i would appreciate if you notes explain any technical terms but if not its ok ill google it .

    submitted by /u/thang2412
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